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  • Amit borrowed a certain amount at a 10% per annum simple interest rate for 4 years. After four years, he repaid a total of Rs. 11,200

Amit borrowed a certain amount at a 10% per annum simple interest rate for 4 years. After four years, he repaid a total of Rs. 11,200 to settle the loan. What was the principal amount he borrowed?

 

Answers (1)

best_answer

Using the formula,

\begin{equation}
    SI = \frac{P \times R \times T}{100}
\end{equation}

Given the data in question,

  • Total amount paid after 4 years = Rs. 11,200
  • Interest rate = 10% per annum
  • Time = 4 years

Putting values in the formula,

\begin{align*}
    SI &= \frac{P \times 10 \times 4}{100} \\
       &= \frac{40P}{100} \\
       &= 0.4P
\end{align*}
\begin{equation}
    A = P + SI
\end{equation}

\begin{align*}
    11200 &= P + 0.4P \\
    11200 &= 1.4P
\end{align*}

\begin{equation}
    P = \frac{11200}{1.4} = 8000
\end{equation}

Therefore, the principal amount Amit borrowed was Rs. 8,000

Posted by

Saniya Khatri

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